State may reinstate Medicaid coverage

State will reconsider eligibility of people dropped from medical assistance.

October 27, 2012|Paul Muschick | The Watchdog

Medicaid is a lifesaver for millions of Pennsylvania's poorest and sickest people, allowing them to receive the medical care they need.

And with millions of public dollars at stake, the state government is supposed to make sure the money is going to people who truly need it by verifying that Medicaid recipients are eligible.

But as is common, your state government wasn't fulfilling that obligation. It fell behind on reviewing about 385,000 cases, and last year rushed to catch up. In the flurry of paperwork that followed, the Department of Public Welfare cut benefits for an estimated 100,000 households.

Questions quickly rose about whether the cuts were appropriate, or whether innocent children and families fell victim to a bureaucracy that couldn't handle the workload and lost critical paperwork.

The federal government questioned whether Pennsylvania officials had improperly terminated people. Lawyers got involved and threatened litigation. Last week, an agreement was reached giving those 100,000 households an opportunity to have their Medicaid coverage reinstated.

The Department of Public Welfare mailed letters to the affected people on Friday, encouraging them to reapply for benefits. It told me it doesn't know how many people might be eligible to reapply in the Lehigh Valley region.

"We found that we agree that eligible people should not have had their benefits cut off and we think we have settled on a method that will allow those who remain eligible to get their health insurance restored quickly and efficiently," Richard Weishaupt, an attorney at Community Legal Services, said in a statement.

The state isn't admitting it made any mistakes, but says it is willing to take a second look.

"If you feel like you still are eligible for medical assistance, please reapply," said Donna Morgan, a Department of Public Welfare spokeswoman.

Medicaid, also known as medical assistance, provides health insurance for low-income and disabled people. The coverage is paid for with a combination of state and federal money.

Last week's agreement does not mean everyone who lost benefits will get them back. They still must meet eligibility guidelines, which include limits on income.

Tim Costa, executive deputy secretary at the Department of Public Welfare, testified before the state House Republican Policy Committee last October that eligibility reviews found recipients who were recently deceased, had moved to other states or otherwise were no longer eligible.

But in a June letter to the department, the federal Centers for Medicare & Medicaid Services said it wanted to know whether proper procedures were followed when determining eligibility.

It questioned why a large number of cases were closed for "failure to provide information" or "failure to return renewal form" at a time when the state had reported being unable to timely process eligibility paperwork submitted by Medicaid recipients.

"It appears that it may have been improper to terminate Medicaid coverage for lack of requested information since an eligibility worker could not have been sure that such information had not been submitted by the beneficiary," wrote Anne Marie Costello, eligibility director at the Center for Medicaid and CHIP Services.

Morgan told me the state was aware of concerns about missing paperwork, but said it's not possible to determine what happened to it and if it was lost, or who lost it.

"All we know is we do not have record of some paperwork," Morgan said. "Because we don't have record of it, we cannot say where the fault lies."

Last week's agreement seeks to prevent a repeat occurrence by reducing the paper shuffle. The state will try to rely less on paperwork to verify eligibility and instead tap electronic data.

The Department of Public Welfare has access to databases providing real-time information on Social Security, veterans benefits, child-support payments, some wages and other benefits, according to the statement from Community Legal Services and Morgan, Lewis & Bockius.

"Paper verification can get lost or misplaced and handling it is time consuming and is error prone," Community Legal Services attorney Justine Elliot said in the statement. "We are happy to reach an agreement with DPW that will place more reliance on using computer information to determine that individuals and families are eligible for Medicaid."

If people who lost benefits are determined to have been eligible, they can seek reimbursement for medical expenses they paid during the time they should have had coverage, Elliot said. They can submit receipts or unpaid bills to Medicaid.

The letters sent Friday by the Department of Public Welfare are printed on blue paper, with the hope that will make them stand out so they are not tossed as junk mail.